Forum Post: The Wall Street Alternative - a National Bank
Posted 12 years ago on Jan. 16, 2012, 9:44 p.m. EST by jinzhao
(68)
This content is user submitted and not an official statement
As Wall Street protestors, I think it is important for us understand that our most important tactic is to define that alternative to Wall Street that we want, and then take the steps that are necessary to bring that into being.
The alternative to Wall Street would be a National Banking system, and it would surely be intended to benefit the 99% of the people, providing them with fairly paid employment and improving the economic condition of our society.
A National Bank would invest in the development of infrastructure projects, and would provide the initiative to economic development in our society.
Big projects like energy and transportation systems, require a lot of high tech manufactured goods, and so would we would also have to restore our industrial capacity.
A National Bank would create a huge market for high tech manufactured goods, calling into being a wide variety of manufacturing firms that could then be financed more by private investors.
The first step would be the enactment of Glass Steagall, to eliminate all of the criminal financial institutions and money that has no value from our economy. Then a National Bank could create credit to infuse the needed amount of money into society while doing productive work to improve the economy.
This honestly sounds like a good idea, although I'd constitute it as a credit union rather than a bank, with American citizens receiving automatic membership upon birth or naturalization and having the option to do business directly with the credit union rather than with private banks (mortgages, auto loans, credit cards, etc.). This would in effect create a financial "public option" for people uncomfortable with banks such as Bank of America but not in a position to turn to a local or private credit union.
What I would further do is allow the federal government to borrow money from the national credit union to finance projects as necessary and basically allocate most of the powers currently in the hands of the Federal Reserve to the credit union, with the caveat that any decision on a loan above a certain value would need to be sent to the members (basically the American people) who would have the opportunity to either approve it or send it back to the originating committee (who would modify the terms as requested and send it back, and this process would continue either until it passes or the originating committee refuses to offer the loan).
I also discussed a related idea on another thread: that of a people's hedge fund. Hedge funds take a lot of capital to get started because they depend on a great deal of money to pay for the analysts that keep track of the markets on a minute-by-minute basis, the schmoozers that cut the sweet deals with the banks, the computer systems that perform the high-frequency trading, etc, and mostly that comes from the ultrawealthy with too much money on their hands. However, what if instead of one guy putting fifty million dollars into starting up a hedge fund we had a hundred thousand guys putting a few hundred dollars each into starting up what would amount to a people's hedge fund? The difference would be that such a fund would serve to maximize profits for ordinary working- and middle-class people instead of for a small group of superrich.
On top of that, the hedge fund would be required by its charter to avoid destructive commodity speculation, maintain its own independent board responsible for rating investments and securities (after what happened in 2008 I don't want any fund relying solely on the Big Three ratings agencies), and maintaining a VC division responsible for providing angel investments and startup capital for eligible small businesses.
This idea in particular would be oriented towards financing large scale economic development projects.
Yes, I can see something like this happening. I would love to see something like this tackle the desperately needed renewable energy infrastructure. If we were able to get enough people to invest in this.. we could use it to drive up demand (since there is so damn many of us). Thus reducing prices as well as ensuring a stable profit from our investments - and to boot we would be generating jobs, cleaning up the environment, and creating a more stable and sustainable future for our children.
Sounds too big to fail!!!! LOL
Think of Kennedy's space program, or the electrification of the Tennessee valley. Big government and big business can work together, oversee each other with check and balances, while creating a lot of opportunities for the little guys.
To solve today's problems, we need creative solutions which bring together opposing parties which should not be in opposition.
Yea!!! That Tennessee valley was awesome!!! Dude! Surf's up, Man!
... After closing arguments in the Tennessee Valley Authority's coal ash trial, there won't be a quick decision.
Following the attorneys' sum up of their cases on Wednesday, a federal judge begins what could be a months-long process of deciding if the nation's largest public utility is liable for the disaster.
Attorneys for TVA and property owners seeking damages from the huge spill of toxin-laden sludge have been squaring off for more than three weeks in Knoxville before U.S. District Judge Thomas Varlan.
TVA attorneys battling negligence claims contend the spill at the Kingston Plant was due to a deep pond slime that moved, causing increased pressure and a breach in an earthen dike.
Attorneys for property owners who are suing contend TVA negligence in maintaining facilities and employee training caused the spill. ...
http://www.wate.com/story/15675903/tva-coal-ash-trial-at-closing-arguments
The solution is really quite simple. You and I are required to carry car insurance, so that in the event of an accident compensation is available, regardless of liability.
There is no such system for large companies that pose risks to the communities where they operate.
We are not social engineers of course. Most of us live our lives, trying to get by, feed and house ourselves and provide for the kids. Most of us don't even think about these kinds of issues until we must, as a result of harm done, to ourselves or our neighbors.
Some of the people affected by this particular disaster lost everything - and probably have seen no compensation of any kind beyond immediate disaster assistance provided by organizations like the Red Cross.
That is inherently unfair. And to top it off - they must have access to expensive attorneys if they are to see even a dime.
Were the decision makers behind this shit hole taken from their homes in the middle of the night, and lynched, I can assure you, several things would happen:
those responsible would be prosecuted to the fullest extent of the law
social engineers of all kinds would come together, to design a system that creates an appearance of fairness, and it would most likely be a form of privatized insurance whose costs are passed on directly to the consumer; thus providing a new mechanism of profit for those social engineers, as well as the armies of attorneys who would litigate matters of liability just as they do now.
a more equitable solution would of course be a national system of liability insurance, much like the FDIC.
And it all begins with investing the social engineers, personally, in the maintenance of systems that produce fairness in the social setting.
One thing.
I agree corporations need to be held accountable for the damage they do.
I also agree that they should have to have some sort of liability coverage for the damage that they do.
But I believe that it needs to be set-up in a way where the cost is not passed on to the consumer.
I believe it should also be set-up so that it does not screw the employees.
All costs should be carried by the owners, board of directors and the executive officers.
When they are slapped with a bill for damages the corporations fees for services or price for product should be frozen, so that they can not pass the cost on to their customer. Their employee base should be frozen as well so that the employees do not get laid off to pay for costs.
If their insurance coverage is not enough to cover the damages, then the owner's, board of directors, and executive officers assets should be attached/sold/confiscated to cover what is missing, again freezing their income with the same restrictions as above to protect the employee's and customers.
Make them take serious consideration for their actions and seriously accountable for mistakes/damages.
The Insurance Providers must be restricted from spreading cost outside of the corporate insurance coverage, they can not be allowed to recoop expenses from other insurance sources.
This is very interesting, jinzhao. Much more interesting than the trolls. Thanks for the diversion.
For me the most important issues are getting money out of politics and reinstating Glass-Steagall.
I don't know enough about a National Banking System but it's provocative. Do you have anything we could read about it?
[Removed]
If the government is who would be running this you can stick it where the sun doesn't shine. Know what I mean?
No, can't say I understand your personal proclivities.
I just don't want government controlling anything. I want them out of our lives.
I understand, government has its problems these days. I think its corrupted by money.
This isn't about getting government into your personal life though. Its about creating jobs that improve the economy.
I dig.
This would take lots of unemployed young people off the streets and put them to work "digging", streets, dams, etc. Then put them through a graduated system of apprenticeships to raise them to a higher skill level, without having to spend big money on college.
By the way, what does Farleymowat mean?
"I dig" is a colloquial term that means, " I understand." Farley Mowat is an author of numerous books of life in northern Canada. Particularly he wrote about the Inuit people, a group I admire greatly.
I see, I traveled through BC, the Yukon and Alaska a long time ago. Only met a few of the native people though, one on Kodiak Island, an Aleut, I think.
See what I have to say below; I don't necessarily want it to be directly run by the government but I'd in effect make it a "people's Fed".
The concept is interesting, but government involvement sucks shit. I hate these corrupt bought off bastards. All of them.
Today, most of them are like that, but I think there are a few good ones, and there is no reason they cannot be as good as anybody, they're just corrupted by money now.
Think about the government system that financed JFK's space program though. That program created an immense amount of economic development, high paying jobs and a new industry - aeorspace.
Society, education, the media, institutions, all corrupt people. We need a system to educate politicians to be decent, like Confucianism did.
I hear you. I know they are not ALL corrupt, just 99%, lol.
Perhaps, but the fact that there is 1% means that it is possible. And how can we build on that 1%? Maybe we have to become those better politicians.
You are an optimist jinzhao.
Optimism is what turns things around actually.
Very true. My wife is like you!
Except that I'm not advocating for a standard government-run bank here; I'm basically arguing for the democratization of America's finances. The national credit union idea would basically allow the people to lend money as they choose to themselves, the government, or to private businesses based solely on the merits of the applicant and the merits of the reason for the loan.
Perhaps that would work, but we need big projects to turn the economy around, don't you think?
Absolutely, and I would expect the government to start requesting monies for large projects fairly soon after the creation of the credit union; my hope would be that handling things that way would force a degree of efficiency on the part of the government in terms of infrastructure and jobs created per dollar.
Yes, hopefully business and government working together could discipline each other.
That would be the idea; for more on what I think about government efficiency you might be interested in this: http://www.themultitude.org/forum/viewtopic.php?f=47&t=585
Interesting site. I think the idea here though would be to increase the amount of taxable economic activity, which hopefully would allow us to decrease the tax rate of individuals, or increase their income to the point at which tax is less of a burden.
I see.
utterly stupid and does not present a proper well argued case.
Perhaps you are a Wall Street banker and don't like the idea of a bank that would benefit the 99%?
Or is it the idea of eliminating criminal banks and phony money that you think is stupid?
Uh-oh!!! Aren't you an analyst?
As the saying goes:
"With Great Power comes Great Responsibility"
1 points by ZenDog (4699) 3 hours ago
The solution is really quite simple. You and I are required to carry car insurance, so that in the event of an accident compensation is available, regardless of liability.
There is no such system for large companies that pose risks to the communities where they operate.
We are not social engineers of course. Most of us live our lives, trying to get by, feed and house ourselves and provide for the kids. Most of us don't even think about these kinds of issues until we must, as a result of harm done, to ourselves or our neighbors.
Some of the people affected by this particular disaster lost everything - and probably have seen no compensation of any kind beyond immediate disaster assistance provided by organizations like the Red Cross.
That is inherently unfair. And to top it off - they must have access to expensive attorneys if they are to see even a dime.
Were the decision makers behind this shit hole taken from their homes in the middle of the night, and lynched, I can assure you, several things would happen:
a more equitable solution would of course be a national system of liability insurance, much like the FDIC.
And it all begins with investing the social engineers, personally, in the maintenance of systems that produce fairness in the social setting.
↥like ↧dislike reply permalink [-] 1 points by DKAtoday (1667) from Coon Rapids, MN 11 minutes ago
One thing.
I agree corporations need to be held accountable for the damage they do.
I also agree that they should have to have some sort of liability coverage for the damage that they do.
But I believe that it needs to be set-up in a way where the cost is not passed on to the consumer.
I believe it should also be set-up so that it does not screw the employees.
All costs should be carried by the owners, board of directors and the executive officers.
When they are slapped with a bill for damages the corporations fees for services or price for product should be frozen, so that they can not pass the cost on to their customer. Their employee base should be frozen as well so that the employees do not get laid off to pay for costs.
If their insurance coverage is not enough to cover the damages, then the owner's, board of directors, and executive officers assets should be attached/sold/confiscated to cover what is missing, again freezing their income with the same restrictions as above to protect the employee's and customers.
Make them take serious consideration for their actions and seriously accountable for mistakes/damages.
The Insurance Providers must be restricted from spreading cost outside of the corporate insurance coverage, they can not be allowed to recoop expenses from other insurance sources.
I'm not an economist - but I tend to think the Fed needs to operate with transparency, it needs to be expanded to at least include the 12 private institutions - known as Federal Reserve Banks. These should all be public institutions, and perhaps the only private banking institutions should be coops or similar organizations.
I'm not at all sure that this will do a whole lot about Wall Street. It would change some of the strategies that companies resort to to raise cash.
Glass Steagall would need to be implemented first, all financial institutions that don't meet the Glass Steagall standard and are not solvent would be allowed to go bankrupt without getting bailed out by the public.
The Fed is pretty transparent as far as banks go. Sometimes they don't reveal who they are loaning money to in order to prevent a run on those institutions, but they publish, in accordance with the law, every penny that's involved in a transaction every month.
There is a lot of mythology about the Fed that simply isn't true. (They don't print money, for example.) That's not to say there isn't PLENTY to be critical about or to be VERY concerned about. Mostly what their priorities are.
But making the central bank public would automatically put monetary and economic decisions under the auspices of the government with its attendant competing political ideologies. Policies would not be based on sound economics, but politics.
I feel that would be a huge mistake, despite the glaring flaws in the current system.
As of now, the Fed's actions have saved the country from another Great Depression. Imagine if it were held hostage to Congress; it would be a disaster that would make our current, horrible situation look like a walk in the park by comparison.
Don't misunderstand: I believe reform is long overdue, and I have NO love of bankers. But if reforms are to be attempted, we have to make sure we are looking at the real, not the imagined problems. Otherwise the wrong leg gets amputated and nothing changes for the better.
I wasn't suggesting that we change the current status of the Fed itself - we can see from the gridlock in Congress that fed policy would be tied directly to engineering the presumed outcome of the next election every four years - and that would be no solution at all.
As I understand it, it is a public institution, authorized by Congress, to operate with independence, it's principle players appointed to serve by the President pending Congressional approval.
Agreed. Sorry if I misunderstood.
I was also addressing, obliquely, some of the other comments by other posters who are so rabidly against the Fed's existence or independence. I also knew that by responding to you rather to some of them, I would get a more even-tempered response.
LoL!